Tuesday, May 18, 2010

Taxing times at Ibrox

Rangers continue to lurch from embarrassment to humiliation off the field as their financial problems grow. And grow. And grow.

Here's a round-up of some of the latest news. But remember folks, we can't be too cocky, whatever the problems they still won the SPL by a country mile. What does that make the rest of us?

Abyss

The club fears the fine, combined with interest of £12m and possible additional penalties, could reach up to £54m.

Combined with its existing debt of about £30m – which it is under pressure from Lloyds Banking Group to repay – this could leave Rangers owing almost £80m.

An Ibrox source described the situation as "desperate", and said: "We're already struggling to pay £30m we owe the bank. Another £50m could tip us in to the abyss of administration. (The Scotsman)

Grim

Arsenal received a demand for more than £11million in 2005 after it emerged payments were being made to players in offshore trusts. The difference between the Gunners and Rangers is the English side could afford to pay.

I do not understand how this has come as a surprise to Rangers, but, if the worst case scenario comes true, they will have major problems. The champions are already £30million in debt, their management team is out of contract and leading players are being sold or are moving on.

Add in a whopping big tax bill and the interested parties considering making an offer for the club are likely to head for the hills. It’s a grim time indeed for the supporters. (Mark McGhee, Press And Journal)

Funds

The Ibrox hierarchy met with the money men a week ago to establish what funds would be available to strengthen the playing squad.

It is believed the bank have again tried to impose cuts to the wage bill, with a total sum of £5million allocated to Walter Smith for wages and transfer fees, but this was resisted by chairman Alastair Johnston and chief executive Martin Bain.

They are acutely aware that Smith needs financial backing with just 14 outfield players, and two goalkeepers, currently signed up for next term.

Should Lloyds refuse to budge and continue to rule Rangers with an iron fist, then Smith may decide to walk away.

He knows he’ll lose Danny Wilson in a £2.5m switch to Liverpool, while Madjid Bougherra – who is believed to have seen a possible move to Hamburg collapse after they sacked boss Bruno Labbadia – is also expected to leave.

Smith wants to keep Nacho Novo, Kris Boyd, David Weir and Kirk Broadfoot, but knows that there will be little left to play with under the current plan. (Evening Times)

Owner

Alastair Johnston, the Rangers chairman, last night criticised the style and substance of Andrew Ellis’s attempted purchase of the Ibrox club, describing it as “way too prolonged” to prove of any use to the club’s board of directors.

Johnston also expressed dissatisfaction at Ellis’s lack of contact with him. The Ibrox chairman has attempted twice to hold a meeting with the London-based developer about his intentions, to no avail.

Johnston was speaking after returning to his International Management Group base in Cleveland, Ohio, having spent the past six days in Scotland trying to resolve the Rangers ownership question.

On that issue there is not good news. “I don’t see any imminent resolution of a new owner for Rangers, so I believe we are going to have to plan and budget on a ‘no change in ownership’ basis going into next season,” he said. (The Times)

Conclusion

So no money, a playing budget under threat, no clarity in the position of the manager and a takeover bid that's going nowhere. Happy holidays.